Bond yields edged lower on Tuesday as commerce ministry in its latest data showed that India’s merchandise exports contracted by 12.7 per cent, third month in a row, to $34.66 billion in April 2023 as compared to $39.70 Billion in April 2022. The decline in exports is mainly on account of poor demand in India's key destinations -- the Europe and the US -- and it may take some more months for the situation to improve.
In the global market, Treasury yields finished higher on Monday, with the policy-sensitive 2-year rate rising for a third straight session, amid hopes for a U.S. debt-ceiling agreement, which softened demand for government bonds. Furthermore, oil prices rose a dollar a barrel on Monday after three straight sessions of declines, boosted by the prospect of tightening supplies in Canada and elsewhere, although recession fears kept pressuring the market.
Back home, the yields on new 10 year Government Stock were trading 3 basis points lower at 6.97% from its previous close of 7.00% on Monday.
The benchmark five-year interest rates were trading 4 basis points lower at 6.92% from its previous close of 6.96% on Monday.